Upon completion of the above studies, subjects will be randomly assigned to receive either placebo or pioglitazone at a dose of 15 mg day for 24 weeks. Subjects will receive dietary counseling prior to the initiation of pioglitazone therapy and be asked to consume a standard ADA, weight maintaining diet throughout the study. Patients will be seen for follow up every 2 weeks. On each follow up visit interim medical history, blood pressure, pulse, weight and fasting plasma glucose concentration will be determined. Every 4 weeks TIMP and TACE substrate activity, adiponectin, visfatin, C-reactive protein (CRP) and markers of inflammation and atherosclerosis (VCAM-1, ICAM-1, endothelin 1, E-selectin, P-selectin) will be measured. In addition, every month we will measure HbA1c, plasma lipids and liver function tests. After 24 weeks of pioglitazone treatment all subjects will have a repeat: (i) measurement of fat and lean body mass by DXA, (ii) OGTT, (iii) vastus lateralis biopsy.